Karoon's Who Dat East JV Sanctions US Gulf Development

Karoon Energy Ltd (ASX:KAR) announced that on 12 August the Who Dat East Joint Venture, operated by LLOG, approved the Final Investment Decision on development of the Who Dat East field in the Gulf of America, USA. The field is located in lease MC 509-1 in a water depth of approximately 1,300 metres. Working interests in Who Dat East are LLOG as operator with 40%, Karoon USA with 40% and Westlawn Americas Offshore with 20%. The project is a one-well development comprising completion of the 2024 Who Dat East discovery well, construction of a 29-kilometre pipeline to the Who Dat Floating Production System, installation of subsea controls and minor upgrades to the FPS. Total capital cost is estimated at US$155-165 million net to Karoon, of which US$15-20 million is to be spent in 2H26.

First production is expected in the second half of 2028 at an initial gross production rate of approximately 6,500 bopd of liquids and 50 MMscf/d of gas, or 2,600 bopd and 20 MMscf/d net to Karoon on a net revenue interest basis, forecast to deliver an initial production rate of approximately 5,900 boepd net to Karoon on that basis, approximately 45% liquids and 55% gas. Karoon stated that its NRI interest is currently approximately 40% and will revert to approximately 32% once the approved royalty relief is exhausted. Production will be co-mingled, transported and processed through the existing Who Dat infrastructure and will follow the same routes to market. Karoon said the initial development is expected to generate an internal rate of return in excess of 20% at mid-case, noting that project economic metrics are based on the current development mid case concept and assume execution substantially in accordance with the approved schedule and budget, timely receipt of regulatory approvals, contractor performance consistent with expectations and no material adverse changes in commodity prices, exchange rates or operating conditions. Karoon will review its existing booked Who Dat East Contingent Resources as part of its 2026 year-end Reserves and Resources review, including consideration of recategorisation of a portion of the Resources as at 31 December 2025, which were stated net to Karoon as 7.0 MMbbl of oil and condensate, 52.2 bcf of natural gas and 15.7 MMboe in total on a 2C basis. Chief Executive Officer and Managing Director Carri Lockhart said the development is economically attractive and will deliver material low cost, high margin production to Karoon when it comes online in the second half of 2028.